Deferred Tax with revaluation.

Hi,

Could you please help me with answering this question, using the 4 steps for deferred tax? I have difficulty understanding what each figure means and I’m also not sure how to work out the tax base for this question:

On 1 January 2008, Simone Ltd decided to revalue its land for the first time. A qualified property valuer reported that the market value of the land on that date was $80,000. The land was originally purchased 6 years ago for $65,000.

The required provision for income tax for the year ended 31 December 2008 is $19,400. The difference between the carrying amounts of the net assets of Simone (including the revaluation of the land in note (above) and their (lower) tax base as 31 December 2008 is $27,000. The opening balance on the deferred tax account was $2,600. Simone’s rate of income tax is 25%.

Thanks.